What a bunch of bankers

They owe us - and don't let them forget it

Here's an understatement of epic proportions from the Times today:

Bankers at Barclays' investment bank are set to see their pay and bonuses more than double to nearly £250,000 this year as their division reports bumper profits today.

The return of bankers' bonuses is expected to provoke outrage so soon after the meltdown in the financial system, which prompted the worst recession since the Second World War.

"Outrage"? I feel nothing but loathing, hatred and contempt for these people - and as I read the latest research from the respected thinktank, the Centre for Economic and Business Research (CEBR), warning that bonus payments by all banks could hit £4 billion this year, up from £3.3 billion in 2008 and less than a year after the crash, I feel sick to my stomach. It is, as John McFall's Treasury Select Committee and others have pointed out, the greed-fuelled bonus culture that helped cause the financial crisis and subsequent recession, through reckless short-termism and excessive and irresponsible risk-taking.

By the way, if I hear one more supposedly informed person tell me that banks such as Barclays and HSBC are entitled to pay out bumper bonuses and ignore popular opinion because they didn't receive taxpayers' cash, in the form of a government bailout, I think I will scream. The fast forgotten fact is that there would be no banks left standing in this country had the Treasury and the Bank of England not intervened in late 2008, and again in early 2009, to prop up the entire financial sector with significant financial guarantees and a promise that the authorities would never let them fail. One estimate puts the cost to the taxpayer for this wider financial support for the banking system at £1.4 trillion - or £56,000 for every household in Britain.

The BBC's Robert Peston makes a similar point on his blog:

Of course, different banks have required different amounts and different kinds of aid from the state, depending on how reckless they had been in the boom.

But they've all had some succour in the form of taxpayer loans and guarantees - even those like Barclays and HSBC that didn't need to be wholly or partly nationalised.

The banks and the bankers owe us - the taxpayer - for their very survival. We owe them nothing - except, perhaps, eternal contempt for dragging us all into the worst recession in living memory.

 

 

 

 

Mehdi Hasan is a contributing writer for the New Statesman and the co-author of Ed: The Milibands and the Making of a Labour Leader. He was the New Statesman's senior editor (politics) from 2009-12.

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Exclusive: Labour MEPs call for Jeremy Corbyn to resign as leader

Letter demands Corbyn's departure and attacks his office for "promoting" the work of the Leave campaign. 

Labour's MEPs have called for Jeremy Corbyn to resign in the latest challenge to his leadership. In a letter sent to Corbyn and leaked to the New Statesman, Glenis Willmott, the chair of the European Parliamentary Labour Party (EPLP), wrote: "We find it hard to see how any Labour leader can continue in that role if they do not have the support of their MPs." Corbyn yesterday lost a no confidence vote among the Parliamentary Labour Party by 176 to 40. The letter also attacked the leader's office for an "official Labour briefing document" which "promoted the work of Kate Hoey and Gisela Stuart for the Leave campaign."

The demand for Corbyn's resignation is described by sources as the "majority position" of Labour's 20 MEPs. Their stance could prove crucial if the leader is not automatically included in any new contest (a matter of legal dispute) and is required to seek 50 nominations from MP/MEPs (20 per cent of the total). 

The letter reads: 

"The European Parliamentary Labour Party met today for its first meeting since the referendum and concluded that we should send you this letter today.

"The EPLP has always striven to have a loyal and constructive relationship with our party leader, and we have worked hard to cooperate with you over recent months. However, we have very serious concerns in the light of Labour's defeat in the referendum campaign.

"Responsiblity for the UK leaving the EU lies with David Cameron. That being said, we were simply astounded that on Friday morning, as news of the result sank in, an official Labour briefing document promoted the work of Kate Hoey and Gisela Stuart for the Leave campaign.

"Labour's loyal and dedicated teams of activists had just spent weeks on the doorstep and on street-stalls making the case to remain in the EU and countering leave campaign arguments. Yet you and your office authorised a briefing that put the whole Labour campaign on a par with two Labour politicians who had been appearing for weeks alongside right-wing politicians, such as Nigel Farage and Boris Johnson.

"Separate from the referendum issue, it has become clear in recent days that you do not have the confidence of the Parliamentary Labour Party. We find it hard to see how many Labour leader can continue in that role if they do not have the support of their MPs.

"So it it with a heavy heart that we urge you, for the sake of the Labour Party and for the people in our country who need a Labour government, to reconsider your position as Labour leader."

Yours sincerely,

Glenis Wilmott MEP

On behalf of the European Parliamentary Labour Party 

George Eaton is political editor of the New Statesman.